One of the things that has cropped up in respnose to the growing popularity of reverse mortgages is the "reverse mortgage alternative". This refers to something that looks a little bit like a reverse mortgage but is slightly different. The most popular of these has been the REX Reverse Mortgage but there are many other reverse mortgage alternatives emerging (like Equity Key) which are all based on the same ideas.
Essentially, these reverse mortgage alternatives offer you cash now for your home. The catch is that they take a percentage stake of the future sale of the home. With the reverse mortgage, your forfeiting equity. With the reverse mortgage alternative, you are forfeiting a percentage of future home value.
If you are thinking that the latter sounds good then you might find a reverse mortgage alternative to be a better solution than the reverse mortgage for accessing cash immediately based on the value of the home. However, you should be aware that there are pros and cons with reverse mortgage alternatives just like there are with reverse mortgages.
It is important that you think about the process carefully. You should shop around with different reverse mortgage alternative companies since there are now several of them out there. You should read the terms and agreements carefully to make sure that you fully understand what you're giving up in order to get the benefits of the reverse mortgage alternative. And you should consider how this differs from the traditional reverse mortgage before you make a final decision.
Question of the Day: Which is the best reverse mortgage alternative out there?
